Cap. 123 Art. 41AInvestment income of collective investment schemes.

For the purposes of the investment income provisions and notwithstanding anything to the contrary contained therein:

(a) when any income referred to in article 41(a) is paid to a collective investment scheme it shall be treated as investment income only to the extent that -

(i) it falls to be accounted for by that collective investment scheme as profits of a prescribed fund; and

(ii) it is not paid by another collective investment scheme;

(b) "prescribed fund" means a collective investment scheme or, in the case of a collective investment scheme divided into sub-funds, a sub-fund of that scheme, that satisfies such conditions as may be prescribed for the purpose of this definition;

(c) "payor" includes an authorised financial intermediary and all the obligations of a payor shall apply to such an intermediary with respect to all payments of investment income effected through his services. A payment of investment income is effected through the services of an authorised financial intermediary when such payment -

(i) is made to the intermediary who holds the relevant investment for the benefit of the recipient;

(ii) is made directly to the recipient who requires that an authorised financial intermediary collects an amount of tax equal to fifteen per cent of such income for onward payment to the Commissioner;

(iii) is made through an arrangement approved by the Commissioner, which arrangement enables the collection of tax on such income through an authorised financial intermediary;

(d) "authorised financial intermediary” means a person holding an investment services licence issued under the Investment Services Act who is registered with the Commissioner and who satisfies such other conditions as may be prescribed;

(e) "recipient" includes a collective investment scheme resident in Malta;

(f) a payor shall deduct tax from every payment of investment income referred to in paragraph (a) at the rate of fifteen cents (0.15) on every euro of such payment or at such other rate or rates, not being more than the said rate and not less than ten cents (0.10) on every euro of the said payment, as may be prescribed;

(g) a collective investment scheme shall not have the right to elect to be paid investment income without deduction of tax being made;

(h) in no case shall a refund be made to a collective investment scheme in respect of tax withheld in accordance with the provisions of this article from investment income paid to that collective investment scheme.